By Glenn Hickling, Head of Legal at BrightRock

Customer complaints may never be the most glamorous part of financial services, but they are one of the most valuable. When handled well, they become a real‑time feedback loop that strengthens products, improves processes, and deepens trust. And in a rapidly evolving financial landscape, where expectations are rising and digital communication is instant, institutions have a powerful opportunity to rethink how they approach customer grievances.

The numbers show just how engaged South Africans are with financial services. According to the Ombud Council’s 2024/25 Annual Report, nearly 50 000 complaints were lodged with recognised ombud schemes during the period, with more than R457 million awarded to consumers through dispute resolution. Far from signalling widespread dissatisfaction, this level of activity highlights how essential these products are in people’s lives, and how important it is for institutions to listen and respond meaningfully.

An opportunity for better processes

The Financial Sector Conduct Authority (FSCA)’s 2025 Complaints Management Industry Review found that many institutions still lack robust, consistently applied complaints‑handling processes. While this reflects growing pains in a complex industry, it also presents a meaningful opportunity: organisations can elevate complaints‑handling into a strategic capability rather than a back‑office function. With the Office of the FAIS Ombud receiving more than 15 400 complaints in 2024/25, an increase from the previous year, the need for clear procedures and skilled complaints teams has never been more evident. By investing in better training and more consistent frameworks, institutions can transform how customers experience moments of frustration.

Complaints can be a tool for customer loyalty

A well‑managed grievance doesn’t just fix a problem, it can convert a dissatisfied customer into a loyal one. When customers feel heard, understood, and taken seriously, they leave with a positive memory of the brand, even if the initial outcome wasn’t what they hoped for. Today’s customers are more empowered than ever. Social media, consumer forums, and online complaints platforms make it easy for clients to voice concerns publicly. This means that an unresolved complaint can quickly escalate – but it also means that a successfully resolved complaint can generate goodwill. Institutions that respond quickly, transparently, and empathetically can turn potential reputational risks into reputational wins.

Using complaints to drive smarter decisions

Forward‑thinking institutions are increasingly treating complaints as strategic data. Analysed properly, complaints reveal patterns and highlight opportunities for improvement: unclear policy wording, friction in claims processes, or underwriting criteria that customers find confusing. By embracing these insights, companies can design clearer communication, streamline procedures, and build products that better match customer needs.

Balancing process with empathy

While processes are essential, they should not become barriers. In South Africa’s administrative environment, documentation delays – like obtaining a death certificate – are common. Institutions that show flexibility and practical problem‑solving, while still managing risk responsibly, demonstrate care at moments when customers need it most.

Institutions have a high duty of care

Financial products are complex, and clients rely on institutions for clarity and support. Because these products are credence goods (experienced only after purchase), customers need knowledgeable, skilled complaints handlers who can guide them confidently. Insurers typically honour 94% to 96% of claims, yet the remaining declined claims still translate into thousands of disputes each year. Strengthening the industry’s approach to complaints can help reduce those disputes and demonstrate a genuine commitment to fairness.

By reimagining complaints-handling not as an administrative burden but as an essential part of customer experience, financial institutions can build trust, reduce friction, and position themselves for long‑term success. When customers feel heard, institutions don’t just resolve complaints – they strengthen relationships.